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"Shanghai
is building the international shipping centre,
so it's always good to upgrade those cities,
bringing those harbours in the eastern coastline
into the initiative," he said.
"You
may have noted the America, Canada, North
America and South America are also omitted,
either deliberately or imprudently from
those two maps," Mr Lin said.
It
emerged from the IHS (JOC) conference panel
that much of substance of the "belt
and road" scheme is overland with seagoing
aspects largely in place except for overseas
port and rail investments.
This
includes port purchases in Sri Lanka, Greece
and Africa as well as overseas rail and
road investments often with participation
of national government financing and soft
loans from development banks.
Panelist
Darryl Hadaway, deputy CEO and CFO of Hong
Kong's Silk Route Rail Limited, which organised
block trains using Khorgos in Kazakhstan's
as the main hub between China, Central Asia,
Middle East and Europe.
The
Silk Way via DP World-managed transshipment
facilities at Khorgos is really new, he
said, before outlining earlier railway border
crossings.
"You
either went for the trans-Siberian or there
was one crossover in Kazakhstan, called
Dostyk, where it was so windy and containers
blew off the trains," he said.
"So
we never really had an option of moving
by rail, until Khorgos came along. Things
have developed over five years because of
the infrastructure being put in place,"
he said.
Mr
Hadaway conceded Silk Way rail from China
to Germany is low volume compared to containerships.
"We're not talking about massive movements
here, it's specialised, it's something to
think about."
His
Silk Route Rail, a new independent and neutral
block train service using Khorgos as the
main hub between China, Central Asia, Middle
East, southern, eastern and Western Europe
as well as the Baltics.
He
reckoned Asia-Europe containers cost shippers
US$1,200 per TEU and took 35-45 days while
air freight for the same volume cost $45,000
and took a few days.
"Rail
is an option that sits in the middle $8,000
per TEU. So, you've seen, I think, Hewlett
Packard going Chongqing to Duisburg in 11.5
days and they're talking about doing it
faster," he said.
Because
of Beijing subsidies, some containers can
moved on the Silk Way for $4,000 to encourage
the trade.
Mr
Hadaway also noted that to use the Asia-Europe
seagoing option from the Chongqing would
require another 15 days to barge containers
the length of the Yangtze to catch a ship
in Shanghai.
He
also said central Asia and Eastern Europe
are developing fast and would soon need
hub-and-spoke services. "I need to
be thinking of how I add value because my
customer's going to be asking me,"
he said.
Two
major problems arise on the Asia-Europe
rail route - quality of service and security,
he said.
"I've
got a lot of nomads out there who jump on
trains and rip things apart. When the train
stops that's where half of the security
issues occur because someone hops on and
tries to break containers open. But block
train slowed this, but it's still an issue,"
he said.
"The
other thing is reliability of schedules.
But people are getting it right. Hewlett
Packard is getting it right. They did some
by air, they were doing some by ship, but
they found out how I work at it, and they
are setting up operations," he said.
He
said there is now talk of Silk Way block
trains carrying New Zealand lamb "because
I can cut down time and get more shelf life
in the UK".
Also
under study are block trains into Middle
East and Turkey, though thus far, major
routes are Chongqing, Duisburg and Chengdu.
"Our
aim, as an independent operator out there,
is to move into a number of provinces and
go to a number of destinations in these
others," he said.
"A
collaboration model is required across the
Silk Way. What is needed is control over
containers, focused on acquiring control
over a significant number of reefer containers,"
he said.
Because
the rail gauge from China is narrower than
in the former Soviet Union, a "few
days" must be taken to transfer the
boxes to new rolling stock, though efforts
are being made to devise a new system where
the wheel bogeys are being changed and put
under the same cars instead.
Said
World Economic Forum supply chain director
Wolfgang Lehmacher, the panel moderator:
"What is crucial is that there
is public-private cooperation, that the
private sector is involved."
Mr
Lehmacher warned the 500 delegates attending
the session that an entirely state-owned
initiative would lead to overcapacity or
unused capacity, and that private sector
involvement was vital to success.
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